tag:blogger.com,1999:blog-7294165939647321702.post3711097718492624707..comments2024-03-28T13:45:43.362-04:00Comments on <center><a href="http://www.barelkarsan.com">Barel Karsan - Value Investing</a></center>: Potentially Undervalued: Craftmade InternationalSaj Karsanhttp://www.blogger.com/profile/04493152766022812984noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-7294165939647321702.post-29209828348187959602008-08-16T13:34:00.000-04:002008-08-16T13:34:00.000-04:00Hi Paul,yes in May 2008 they announced a suspensio...Hi Paul,<BR/><BR/>yes in May 2008 they announced a suspension of the dividend. In the last quarterly financial report management reiterated the policy of using free cash flow to pay down debt, pay dividends, fund acquisition, fund investments and repurchase stock. However, there is new management at Craftmade so we will have to see how they use the cash.<BR/><BR/>Within the last calendar year, $16.8M in cash was used to pay for acquiring the assets of Woodard LLC. I noticed the deb to capital ratio is getting up there, so its entirely possible management wants to pay down debt further given the market conditions. <BR/><BR/>I take solace in the fact the company has a great track record for being free cash flow positive, good (not too volatile) operating margins and has raised dividends at a very respectable dividend compound growth rate over time. This is a small cap company, so it's not unusual for the dividend payments to be more inconsistent than large cap companies. So far I am not concerned, but i wan't to see how the new management is going to use the free cash flow over the next few quarters. I will be looking at whether they pay down debt and/or do something else intelligent with cash saved from the suspended dividend.<BR/><BR/>What do you think?Reyer Barelhttps://www.blogger.com/profile/07311930625531394620noreply@blogger.comtag:blogger.com,1999:blog-7294165939647321702.post-91664082475740019632008-08-16T09:52:00.000-04:002008-08-16T09:52:00.000-04:00They suspended their dividend in July unfortunatel...They suspended their dividend in July unfortunately. They also missed one dividend in 2006 so I'm not sure if it's something to worry about.Anonymousnoreply@blogger.com